Posttraumatic stress disorder (PTSD) is characterized by exaggerated expression of fear responses to danger and safety cues. Translational research suggests that dexamethasone facilitates fear extinction in animal and human fear conditioning models. For this randomized, placebo-controlled trial (N = 27), we aimed to translate these ﬁndings to the clinic by using virtual reality exposure (VRE) therapy for OEF/OIF/OND veterans with PTSD to determine whether dexamethasone will increase the eﬃcacy of exposure therapy for VRE relative to placebo. VRE sessions involved imaginal exposure to the most traumatic war memories while viewing a computer-generated view of virtual Iraq or Afghanistan with multisensory stimulus options used to match patient’s description of the trauma. VRE was eﬀective in reducing PTSD symptoms but there was no interaction with dexamethasone. Drop-out rate was signiﬁcantly higher in the dexamethasone group, with 10 of 13 (76.9\%) participants in this group discontinuing, compared to only 4 of 14 (28.5\%) in the placebo group, χ2 = 6.31, p = 0.02. Results indicate that the dexamethasone group may have experienced an increase in PTSD symptoms, particularly reexperiencing, at session 2 following ﬁrst drug administration. Contrary to study hypotheses, dexamethasone did not enhance exposure therapy outcomes and was associated with increased drop-out. This demonstrates potential pitfalls in translating neuroscience models to the clinic; future research carefully examining glucocorticoid mechanisms involved in therapy augmentation is warranted.